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Mylan NV (NAS:MYL)
Beneish M-Score
-2.32 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Mylan NV has a M-score of -2.32 suggests that the company is not a manipulator.

MYL' s Beneish M-Score Range Over the Past 10 Years
Min: -4.19   Max: -1.85
Current: -2.32

-4.19
-1.85

During the past 13 years, the highest Beneish M-Score of Mylan NV was -1.85. The lowest was -4.19. And the median was -2.41.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Mylan NV for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 0.9705+0.528 * 1.0221+0.404 * 1.2922+0.892 * 1.2215+0.115 * 0.7039
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0982+4.679 * -0.0429-0.327 * 0.6726
=-2.32

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $2,689 Mil.
Revenue was 2490.7 + 2695.2 + 2371.7 + 1871.7 = $9,429 Mil.
Gross Profit was 1062.6 + 1315.3 + 1008.1 + 830.1 = $4,216 Mil.
Total Current Assets was $6,473 Mil.
Total Assets was $22,268 Mil.
Property, Plant and Equipment(Net PPE) was $1,984 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,032 Mil.
Selling, General & Admin. Expense(SGA) was $2,181 Mil.
Total Current Liabilities was $4,122 Mil.
Long-Term Debt was $6,296 Mil.
Net Income was 194.6 + 428.6 + 167.8 + 56.6 = $848 Mil.
Non Operating Income was -134.7 + -50.9 + -2 + -18.5 = $-206 Mil.
Cash Flow from Operations was 652 + 974.8 + 114.7 + 267 = $2,009 Mil.
Accounts Receivable was $2,269 Mil.
Revenue was 2082.7 + 2084 + 1837.3 + 1715.6 = $7,720 Mil.
Gross Profit was 969 + 1012.4 + 808.8 + 737.8 = $3,528 Mil.
Total Current Assets was $6,441 Mil.
Total Assets was $15,821 Mil.
Property, Plant and Equipment(Net PPE) was $1,786 Mil.
Depreciation, Depletion and Amortization(DDA) was $567 Mil.
Selling, General & Admin. Expense(SGA) was $1,626 Mil.
Total Current Liabilities was $5,304 Mil.
Long-Term Debt was $5,700 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(2689.1 / 9429.3) / (2268.5 / 7719.6)
=0.28518554 / 0.29386238
=0.9705

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(1315.3 / 7719.6) / (1062.6 / 9429.3)
=0.4570185 / 0.44712757
=1.0221

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (6472.7 + 1983.9) / 22267.7) / (1 - (6441.2 + 1785.7) / 15820.5)
=0.6202302 / 0.47998483
=1.2922

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=9429.3 / 7719.6
=1.2215

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(566.6 / (566.6 + 1785.7)) / (1032.1 / (1032.1 + 1983.9))
=0.24087064 / 0.34220822
=0.7039

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(2180.7 / 9429.3) / (1625.7 / 7719.6)
=0.23126849 / 0.21059381
=1.0982

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((6295.6 + 4122.2) / 22267.7) / ((5699.9 + 5304) / 15820.5)
=0.46784356 / 0.69554692
=0.6726

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(847.6 - -206.1 - 2008.5) / 22267.7
=-0.0429

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Mylan NV has a M-score of -2.32 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Mylan NV Annual Data

Mar06Mar07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.81211.12811.04311.06940.87571.09620.98281.15181.11560.9705
GMI 0.99650.95381.2990.98921.00130.97280.97720.97250.96291.0221
AQI 1.1471.86912.18320.99850.99110.98930.95771.07730.80161.2922
SGI 1.0031.28213.18740.99131.07021.12461.10871.01661.11731.2215
DEPI 1.14441.25550.28791.08471.01630.91751.00411.18880.9820.7039
SGAI 0.86720.74591.53341.00560.96680.99391.0340.9951.0331.0982
LVGI 4.09761.08981.16410.96270.98791.09480.94031.0931.00830.6726
TATA -0.1339-0.0525-0.0554-0.0365-0.0479-0.0145-0.0261-0.0267-0.0026-0.0429
M-score -4.19-1.99-0.34-2.58-2.75-2.41-2.54-2.44-2.39-2.32

Mylan NV Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 1.10841.15181.08471.02620.9251.11561.19791.37681.3890.9705
GMI 0.97220.97250.97110.98020.97140.96290.95950.97320.98611.0221
AQI 0.97311.07731.10621.11660.91230.80160.95630.951.20971.2922
SGI 1.03321.01661.02181.03951.09111.11731.12621.17971.21171.2215
DEPI 1.12651.18881.19231.18651.08080.9820.95850.83440.75670.7039
SGAI 0.99130.98660.98951.06641.05611.04181.08031.06061.04991.0982
LVGI 1.07871.0930.92451.01161.03951.00830.73450.73270.66530.6726
TATA -0.0235-0.0267-0.0372-0.0398-0.0249-0.0026-0.00380.0009-0.0249-0.0429
M-score -2.50-2.44-2.48-2.56-2.65-2.39-2.17-1.95-1.90-2.32
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